Pool Outlook - Navigating a Bearish Technical Environment

Market Snapshot: Bearish Signals Overwhelm Technical Outlook

Takeaway: Pool (POOL) is under pressure with 5 bearish signals and zero bullish ones, leading to a weak technical outlook with an internal diagnostic score of 1.71 — a clear signal to be cautious or avoid.

News Highlights: Industry-Wide Challenges Loom

• 2025 Mid-Year Report: As of July 2025, the manufacturing and distribution industry shows signs of recovery but still faces challenges from past economic disruptions. Distributors are struggling to predict tariff impacts and manage ongoing supply chain uncertainties.
• Supply Chain Disruptions: Recent articles highlight how natural disasters, political instability, and pandemics continue to disrupt the supply chain, increasing delays and costs for industrial distributors like Pool.
• Tariff Uncertainty: A panel of distribution leaders in 2025 emphasized the need for adaptability in the face of tariff uncertainties and material shortages, indicating that the sector is under ongoing stress.

Analyst Views & Fundamentals: Mixed Signals Amid Weak Performance

Average Rating Score: 3.50 (simple mean), and Weighted Rating Score: 2.31 (performance-weighted). Analysts remain divided — one 'Buy' and one 'Neutral' rating — despite a recent 3.79% price increase.

• Consistency: Analyst ratings are not aligned, with one analyst from Baird showing a strong historical win rate (66.7%) and the other from Oppenheimer having a poor record (33.3%).
• Price Trend Mismatch: Despite a recent price rise, market expectations remain neutral, suggesting a divergence between price action and analyst sentiment.
• Fundamental Highlights:
  • ROE (Annualized): 38.53% (model score: 2.00)
  • ROE (Diluted, YoY growth rate): 16.46% (model score: 2.00)
  • Net Profit Margin: 8.68% (model score: 1.00)
  • Current Liabilities / Total Liabilities: 34.05% (model score: 0.00)

Money-Flow Trends: Large Capital Inflows Dominate

Pool has seen strong inflows across all investor segments, with the overall inflow ratio at 50.88% and a positive trend. Large and extra-large investors are particularly active, with inflow ratios of 51.48% and 50.65%, respectively. These figures indicate continued institutional interest in the stock despite the bearish technical signals.

Key Technical Signals: Bearish Momentum Gaining Ground

• William's %R Overbought: Internal diagnostic score: 1.00 — signals overbought conditions with historically weak returns (avg -1.85%).
• Bearish Engulfing: Score: 1.00 — a clear bearish reversal pattern with an average return of -2.33%.
• MACD Golden Cross: Score: 1.75 — typically bullish, but here it aligns with bearish sentiment, indicating a mixed or misleading signal.
• Dividend Payable Date: Score: 1.00 — historically, this event tends to depress performance (avg -1.26%).

Recent Chart Patterns:

• September 5: WR Overbought and MACD Golden Cross
• September 8: WR Overbought again — a repeat overbought signal

These patterns suggest a loss of upward momentum and confirm the bearish outlook.

Conclusion: Proceed with Caution

Pool is facing a combination of weak technical signals and mixed analyst views. With an internal diagnostic score of 1.71 and five bearish indicators, the risk-reward is skewed toward the downside. While large investors remain active, the fundamentals and recent chart behavior suggest investors should consider waiting for a pullback before entering or adding to positions.